There were fewer home buyers — and sellers — in the Twin Cities metro in October than in the same month last year, but houses sold more quickly and prices posted another double-digit increase, the Minneapolis Area Realtors said Tuesday.
During October, buyers across the 16-county metro signed 5,745 purchase agreements, down 10.2% from last year. At the same time, sellers listed 6,192 properties, a 11.5% annual decline.
Despite those declines, houses sold more quickly than last year and for much higher prices. The median price of all closings during the month was $340,000, a 7.9% gain.
The housing market in the Twin Cities is returning to more normal seasonal cycles after a pandemic-fueled buying binge at this time a year ago. When the virus arrived in spring 2020, real estate deals slowed down. The return later in the year elevated deal-making in the fall, which is now skewing annual comparisons.
Though October sales were down considerably compared with last year, both pending and closed sales this year were ahead of 2019 by double digits.
“We’re still stuck in this period of apples-to-oranges year-over-year comparisons where we’re up against a uniquely strong pandemic market,” MAR PresidentTodd Walker said in a statement.
Despite the decline in year-over-year sales last month, the housing market in the Twin Cities suffers from a lack of listings, which has stifled sales and forced buyers to make quick decisions and pay many sellers more than their asking price.
During the month, sellers listed 6,192 properties, more than 800 fewer than last year and a couple hundred less than the year before. That left buyers with 16% fewer options at the end of the month.
At the current sales pace, there were only enough listings to last 1.4 months. The market is considered balanced between buyers and sellers when there’s a five- to six-month supply of listings.
“Pricing has remained firm from all the demand still in the market as well as the supply squeeze,” according to Tracy Baglio, president of the St. Paul Area Association of Realtors, which released the report in conjunction with MAR.
With more buyers than sellers in some parts of the metro, houses sold quickly and with multiple offers. On average, houses in the metro sold in 22 days, a nearly 23% annual decline. And sellers received 100.3% of their asking price, down slightly from last year.
There are signs the market may be shifting, however. New listings have continued to hit the market, bucking seasonality trends commonly seen in the fall, a time when listing and sales activity typically slows as children return to school.
Statewide, closings were down about 16% — about the same as in the Twin Cities metro — but demand varied dramatically from region to region, according to the Minnesota Realtors. The group, which also represents agents in outstate Minnesota, said sale prices increased more moderately and the average market time was about a month.
Closings were up the most, at 6.5%, in the Headwaters region of north-central Minnesota, which also posted the biggest increase in the median sale price — nearly 25% more than last year. Sales were down the most, 23.5%, in the nearby Arrowhead region.